Big box stores seem to be closing left and right. As an investor, there are many things that can be done with such a considerable amount of space, but renting out or repurposing a large property like this can seem like a daunting task if you’re not sure what types of businesses to market the space to. There are always temporary solutions, like renting out the space to a seasonal business, but that’s just the tip of the iceberg, when it comes to what’s possible.
So what are some good options for reusing the space? Here is what Forbes Real Estate Council members have to say:
Members discuss a few ways investors can repurpose empty box stores.
Photos courtesy of the individual members.
1. Try Out Short-Term Options
Good options for repurposing retail stores include pop-up shops, art galleries and communal work spaces. Giving a popular local food truck a place to set up can also draw people to the space, and may help cultivate a future tenant. – Deborah Rabbino Bhatt, Vesta New York
2. Utilize As A Storage Facility
Even though many major retailers are becoming extinct, there are companies like Amazon that need storage space and empty warehouses. A former box store can easily be turned into a facility that could be used to store products. – Engelo Rumora, List’n Sell Realty
3. Repurpose As Startup Incubators
Depending on the location, big box stores could be converted into startup incubators like 1871 in Chicago. Ideally, developers could form public-private partnerships with municipalities to transform these locations, provide high-speed internet and startup coaching services at low cost, and then create powerful ecosystems for innovation and growth. – Marc Rutzen, Enodo Inc.
4. Divide Up The Space
One of the best ways to repurpose large empty buildings is to divide them up into smaller spaces that can be more easily rented. You must be careful with zoning and what is allowed, as box stores sometimes build restrictions in regards to what their site can be used for. – Mark Ferguson, InvestFourMore
5. Use For Niche Food Courts
The food business is actually being helped rather than harmed by new technologies, unlike big box stores. The internet and social media have helped bring exposure to more food businesses as well as created an ever-growing foodie culture and community. Many food courts have seen a lot of success as they’ve enabled entrepreneurs to start up with less capital than a traditional brick and mortar. – Catherine Kuo, Elite Homes | Christie’s International Real Estate
6. Use It To Create Experiences
We are in an experience economy, and those old big box stores are perfect for trampoline parks, axe throwing, bowling and similar entertainment. With the fast-growing trend of esports, they could also make great locations for video game tournaments. – Jeremy Brandt, Fast Home Offer
7. Transform Into Community Centers
The large building size and parking capacity make vacant box stores perfect venues for multipurpose community centers. Space can be divided into meeting rooms, daycare facilities, gyms and satellite office space for nonprofits. Another great use is repurposing the space as a library and subdividing the interior into meeting rooms, reading rooms, computer labs and study centers. – Joe Houghton, RE/MAX Results | The Minnesota Property Group Team
8. Turn Into Co-Working Or Flexible Office Space
The retail landscape is evolving and we’re starting to see co-working or flexible office space replace or enhance retail. For example, Staples is now adding co-working into their existing space to bring experience to their retail product, and other retail spaces are transforming entirely into office or meeting space—like Saks and Barneys with Convene and Industrious, respectively. – Christopher Kelly, Convene
9. Look For Fitness Tenants
We have seen more health and fitness tenants. The potential benefits to the retail property are: The ability to drive foot traffic; the tenants may be more resistant to the online shopping trend, as one cannot conduct a workout online; and leases are generally net leases, which typically result in the investor receiving consistent cash flow, with minimal to no additional capital requirements. – Todd Blanding, Platform Ventures